Structural Local Authority Collaboration in the Netherlands

Abstract

Collaboration has been recognised and acknowledged in the public procurement sector as an opportunity to obtain better purchase conditions from the market. Against this backdrop, this thesis explores how a relatively new form of structural collaboration affects the long-term procurement performance of local authorities.The aim of this research is to evaluate the impact of structural collaborative procurement organisations on the performance of local authorities. If it enhances procurement performance in the Netherlands, it could be an alternative to organisational restructuring, such as the merger of local authorities or entering into shared-services. In recent years, the Netherlands has seen key decentralisation operations in a number of policy areas (De Klerk, Gilsing, & Timmermans, 2010). These transformations and changes have put a spotlight on the optimisation of the current size of the local authorities in the business process with the goal of improving the performance of individual local government organisations.Building on the excellent previous research on collaboration, this research studies the challenges and opportunities of structural collaboration for local authorities, especially in the area of procurement. A review and synthesis of a strategic and economic theories, collaborative arrangements and shared service centres identified a gap in the literature related to adding value and less uncertainty for lower cost, aimed at local authorities, which underpins the concept of structural collaboration.This study contributes to a deeper and more meaningful understanding of the long-term and structural benefits of structural procurement collaboration for organisations. These contributions are in value items, which aid the procurement function in the organisation to the advanced level of professionalisation. This research demonstrates that structural collaboration produces positive results in the field of knowledge, professionalism, reputation, innovation, complementary resources, quality of services, information asymmetry, cost competitiveness, and economics of scale. Likewise, a point is made in the area of cost savings through improvements in efficiency and effectiveness, in the execution of procurement projects, as well in the fields of resource sharing and capabilities, control of information, coordination and mechanism, agility and flexibility and uncertainty.This study contributes to the fields of politics and management through supporting alternatives for possible amalgamation in municipalities in the Netherlands (Kay, 1995; Laar, 2010). Naturally, there are no perfect solutions in such complex discussions; nevertheless, this study hopes to contribute to the continuity, professionalism, and robust public organisation of the debate. Current existing collaborative (procurement) organisations can improve their collaborative organisations based on the Structural Collaborative Procurement (SCP) framework developed herein. The contribution of the final practitioner, a Chief Procurement Officer of collaborative organisations, is in terms of insight into coordination between participants and collaborative organisations, the boundary between outsourcing versus insourcing procurement activities, reducing (procurement) organisational risks, two-way collaboration, symmetry of information etc., which in turn can be used to increase the productivity of collaborative (procurement) organisations